Lack Of Funds Not An Accepted Excuse: Delhi High Court To Civic Bodies Over Salaries

The Delhi High Court, while hearing the batch of petitions in relation to non-payment of salaries and pensions to the employees of municipal Corporations, said that non-availability of funds cannot be and shall not be accepted by the court as an excuse for untimely payment of salaries on Wednesday.

The court has also directed the Municipal Corporations to place the different heads of expenditure in respect to the Municipal Councillors, Class-I officers and Class-II officers. The amounts incurred in providing perks to them should be clearly disclosed under each specific head.

The direction of Court has come during the hearing of a batch of petitions in relation to non-payment of salaries and pensions to the employees of the Delhi Municipal Corporations, particularly, North Delhi Municipal Corporation (NDMC) and East Delhi Municipal Corporation (EDMC).

The bench of Justice Vipin Sanghi and Justice Rekha Palli in an order passed on January 15 has sought the detail of expenditure spent Municipal Counsellors, Class-I officers and Class-II officers. The amounts incurred in providing perks to them should be clearly disclosed under each specific head, the court said while seeking the required information in affidavits from respective Municipal Commissioners.

The court noted that the reason assigned for non-payment of timely salaries is stated to be the paucity of funds which, as is well settled, cannot be an excuse for non-payment, keeping in view the fact that the right to receive salary and pension is a fundamental right enshrined under Article 21 of the Constitution of India and non-payment thereof would have a direct bearing on the quality of life of the person entitled thereto and their dependants.

During the hearing, Advocate Satyakam, additional standing counsel for the Government of NCT of Delhi explained that there are two heads under which the Government of National Capital Territory of Delhi (GNCTD) transfers funds to the Municipal Corporations, first being the Basic Tax Assignment (BTA) wherein 6% of the revenue collections of the GNCTD is transferred and second under the head of Grant-in-Aid (GIA) for the purpose of Education, Health and Urban Development wherein 6.5% of the revenue collections are provided to the Corporations.

Advocate Satyakam further submits that on account of and during the pandemic, even though the revenue generation of the GNCTD has taken a serious hit, the GNCTD has decided not to cut either the BTA or the GIA. However, the amount of BTA stands reduced in proportion to the decrease in the revenue generation with the GNCTD.

The court also noted that Municipal Corporations had outstanding loans taken from the GNCTD, and while transferring the BTA, the GNCTD has sought to adjust the outstanding loans, which has substantially reduced the actual amount transferred by the GNCTD to the Municipal Corporations.

Apart from BTA, the GNCTD is also required to transfer amounts towards Transfer Duty and Parking Charges to the Municipal Corporations. However, it is submitted that the amounts receivable under these two heads are also outstanding.

Delhi Government Counsel stated that they will report instructions on the aspect of the release of the loan amounts which were deducted from the BTA, keeping in view the aforesaid circumstances. They will also state as to how much amount is liable to be transferred, and by when the outstanding Transfer Duty and Parking Charges would be transferred.

The court said, "It is absolutely necessary that payment of salaries/ pensions is made to the employees/ retired employees of the Corporations, which also includes Doctors, Para Medical Staff and Health Workers - who are rendering their services in the time of pandemic and serving the citizens of Delhi. In fact, the payment of salaries and pensions has to be prioritised over other discretionary expenses that the Corporations are incurring."